Top 11 DePIN Projects to Keep an Eye on in 2024
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Authors: Bybit Learn Team, Miles Deutscher (Crypto analyst and DeFi addict)
Popular crypto niches like artificial intelligence (AI) and real-world assets (RWA) enjoy significant attention from investors and industry analysts. However, upon closer scrutiny, many projects within these areas are propped up primarily by hype, and often lack profitability. On the other hand, away from the glitz and glamor of the crypto market's center stage, one niche has firmly established itself as a model of profitability: DePIN, an acronym for decentralized physical infrastructure network.
DePIN platforms facilitate the decentralized sharing and utilization of hardware and software resources among users. Numerous computing infrastructure sectors, such as storage, processing power, AI services and media streaming, use DePIN platforms to achieve benefits such as exceptional scalability, cost-efficiency and service variety. With a projected valuation of at least $3.5 trillion by 2028, the DePIN niche of the crypto market is worth keeping an eye on.
Key Takeaways:
Decentralized physical infrastructure network (DePIN) platforms provide access to and enable the trade of hardware and software resources over blockchain networks.
Major DePIN categories include storage solutions, computing, network connectivity and media provision.
DePIN is a burgeoning sector with $1.5 trillion in annual revenues, and is forecast to reach $3.5 trillion in valuation by 2028.
What Is a DePIN?
Decentralized physical infrastructure network (DePIN) refers to a blockchain platform that facilitates an exchange of hardware- or software-based computing resources between users. The exchange happens via a decentralized network that acts as a connecting medium or marketplace for the resources.
A typical DePIN platform has two main user groups — resource providers and resource consumers. Resource providers contribute their computing power, storage capacity or other hardware/software resources to the network, receiving rewards in crypto tokens. Members of the consumer group pay for access to these resources and source them via the decentralized network, typically on a flexible, per-use basis.
Since resource sellers are rewarded with crypto tokens, there are significant incentives for both individuals and entities, such as corporations and startups, to expand their resource capacities and service offerings on the network. This acts as an essential driver of growth for sectors leveraging DePIN platforms.
For resource consumers, DePIN networks represent an affordable, highly flexible and versatile way of sourcing computing capacity that otherwise would be prohibitively expensive or complex to access.
The DePIN sector is one of the most profitable and resilient areas in the blockchain industry. According to Messari, it currently generates over $1.5 trillion in yearly on-chain revenues. The sector’s total valuation is expected to reach at least $3.5 trillion by 2028. Messari's report also predicts that DePIN could contribute $10 trillion to the global GDP over the next decade, potentially reaching $100 trillion a decade later.
Top DePIN Crypto Projects
DePIN projects can broadly be classified into several categories based on their leading use cases. Each category has the potential to disrupt an industry worth over $1 trillion, indicating the vast growth potential of DePIN. The major categories include:
Storage Solutions — Networks that provide decentralized and secure blockchain-based storage for files, apps and websites. The major players in this category include FileCoin (FIL), Arweave (AR) and ColdStack (CLS).
Computing— Marketplaces or platforms for decentralized lending and borrowing of computing processing power. These include general processing power leasing platforms, such as Internet Computer (ICP) and Akash Network (AKT), and specialized service providers like Render Network (RNDR), which enables the trade of GPU-based computer rendering services.
Network Connectivity —Decentralized solutions that facilitate connectivity and the exchange of data among users or devices, particularly in areas like the Internet of Things (IoT) or machine-to-machine (M2M) communications. Notable projects in this sphere include Helium (HNT), MXC (MXC) and IoTeX (IOTX).
Media Provision— Platforms that use blockchain environments to enable the delivery of rich media resources and services such as video streaming or complex, interactive maps. The primary players in this category include Theta Network (THETA) and Hivemapper (HONEY).
Let’s have a look at the major DePIN players within these four categories — 11 projects that drive the immensely promising and confidently growing DePIN sector.
1. Filecoin (FIL) – DePIN Category: Storage Solutions
Filecoin (FIL) is a peer-to-peer (P2P) network that provides a decentralized storage solution, marketplace and protocol. Launched in July 2014, it’s probably the oldest project in the DePIN niche of the crypto industry: it all started with Filecoin and its promotion of decentralized storage and retrieval solutions. The platform acts as a blockchain-based alternative to centralized cloud storage solutions.
Filecoin is built on top of the InterPlanetary File System (IPFS), with data stored off-chain. Its use of the Filecoin virtual machine (FVM) allows for computations and calculations to be performed on the stored data without having to first retrieve the data.
Filecoin provides several advantages over its mainstream competitor, Google Cloud. Its price remains low due to the decentralized nature of the open market and small, independent storage providers. Moreover, Filecoin users can freely switch storage providers, as they all basically offer the same services and API. Finally, the barrier to becoming a storage provider for Filecoin is much lower than that for Google Cloud. All you require is a PC and a reliable internet connection — whereas you'll need legal agreements, marketing and support staff for Google Cloud.
2. Arweave (AR) – DePIN Category: Storage Solutions
Arweave (AR) is a decentralized storage network that aims to provide distributed permanent and immutable storage solutions. Launched in 2018, Arweave is a key competitor to Filecoin in the area of decentralized storage, with its main advantage in offering you permanency and immutability of storage, as long as Arweave exists. Simply pay a one-time fee to securely and permanently store data — or even entire websites and applications.
Resource providers are rewarded with AR tokens for making their spare disk storage available on the network. Since each file is stored in a fragmented manner, scattered across the numerous nodes on the network, no individual resource provider will have your files available on their computer.
3. ColdStack (CLS) – DePIN Category: Storage Solutions
ColdStack (CLS) is an aggregator for various decentralized storage network-based platforms, including Filecoin, Arweave and more. It uses AI technology to optimize the decentralized storage of files across different blockchain-based platforms, and can thus be considered a connecting layer that brings together the major storage solutions available on the market.
4. Render Network (RNDR) – DePIN Category: Computing
Render Network (NDR) is a decentralized app (DApp) on Ethereum that acts as a marketplace for GPU-based rendering services. Computer rendering is the process of creating rich 2D and 3D images, animation and video from initial models outlining the finalized product. This technique is used in movies, video games, architectural visualization and many other fields to create visual representations of ideas or concepts. It’s also a highly resource-intensive process, at least in the case of modern, visually rich games and animations.
Render Network democratizes access to rendering services by providing an affordable and flexible platform on which designers, artists and studios can access GPU processing capacity over a decentralized network on a per-use basis. Those with powerful enough GPUs can also benefit by providing their idle processing capacity in exchange for rewards in RNDR tokens.
In the highly specialized niche of decentralized rendering services, Render Network is the undisputed leader. As of early 2024, no other notable crypto project could even remotely rival its platform in this sphere.
With its focus on supporting visually rich gaming and animation projects, Render Network is also considered a key metaverse project.
5. Internet Computer (ICP) – DePIN Category: Computing
Internet Computer (ICP) is a network of distributed data centers around the world that provides hosting and processing capacity to DApps utilizing the platform. Its data centers consist of node providers organized into subnet blockchains that run in parallel to each other. The network’s ability to add subnets regularly allows for scaling to create an unlimited number of DApps.
Data centers providing computing resources to user apps and websites are rewarded with ICP tokens for their contribution. As of mid-March 2024, there are 111 of these centers, located all over the world.
6. Akash Network (AKT) – DePIN Category: Computing
Akash Network (AKT) is an open-source decentralized computing power marketplace. In exchange for rewards paid in AKT tokens, resource providers on Akash can contribute their machines' hardware capacity, such as CPU, GPU, memory and storage. Users of the resources can access them more affordably and flexibly as compared to centralized cloud computing solutions. The Akash blockchain is built on top of the Cosmos SDK and Tendermint Core.
7. Helium (HNT) – DePIN Category: Network Connectivity
Helium (HNT) is a blockchain-based platform that acts as a decentralized network of wireless devices. The project aims to provide expansive, virtually limitless wireless internet connectivity, particularly for IoT devices. Helium rewards users with crypto tokens for setting up wireless hotspot devices and joining the network to provide connectivity.
The Helium project was launched in 2019 on its own Layer 1 blockchain, but migrated to Solana (SOL) as a DApp in 2023. Helium is essentially a decentralized alternative to traditional internet service providers (ISPs), albeit with the benefit of expansive, global reach. It can be thought of as a global virtual network operator.
8. MXC (MXC) – DePIN Category: Network Connectivity
The MXC Foundation (MXC) is an Arbitrum-based project aimed at building a global data network. The project focuses on using a decentralized data network, the MXProtocol, to power IoT and M2M devices via LPWAN (low-power wide-area network) technology. MXC tokens are used within the MXProtocol to incentivize users to share and trade data, as well as participate in network governance. An LPWAN is a type of wireless network similar to Wi-Fi that provides efficient and secure data transmission for diverse use cases, such as smart cities, logistics, agriculture and more.
9. IoTex (IOTX) – DePIN Category: Network Connectivity
IoTeX (IOTX) is a decentralized P2P network designed for IoT connectivity and other use cases. IoTeX enables IoT devices to interact with each other and the blockchain, facilitating data exchange and secure communication. It has a built-in, decentralized bridge that’s fully compatible with Ethereum and other Ethereum virtual machine (EVM) chains.
Conceptualized in 2017, the project launched its mainnet in 2019, initially positioning itself as a major IoT-focused blockchain. As the DePIN concept gained traction in the crypto industry, the IoTeX team sensed the enormous opportunities in this area and started to position the platform as a solution for DePIN projects and developers.
10. Theta Network (THETA) – DePIN Category: Media Provision
Theta Network (THETA) is a decentralized video streaming network whose users provide their idle storage and bandwidth in exchange for crypto rewards to facilitate the efficient delivery of video content. It isn’t simply a distributed version of YouTube — it’s a blockchain platform for managing the contribution and utilization of computing resources that support the delivery of media content, which typically requires significant bandwidth.
Theta Network can be thought of as a decentralized alternative to traditional, centralized content delivery networks (CDNs) like Cloudflare, Amazon CloudFront and Akamai. Theta currently operates on the EVM-compatible Theta Metachain, which is a network of subchains connected to a mainchain. This structure allows for unlimited scaling and potentially unlimited transactional throughput. With a market cap of around $2.74 billion (as of Mar 19, 2024), Theta Network is the confident leader in the niche of decentralized video streaming services.
Theta also has a broader vision of becoming a hybrid cloud computing platform, with a fully decentralized global edge architecture. When it shifts to Theta EdgeCloud in May 2024, it will be able to harness edge CPUs and GPUs worldwide in order to meet growing video demand, AI adoption and the call for new "bite-sized" infrastructure compute services.
11. Hivemapper (HONEY) – DePIN Category: Media Provision
Visually rich media comes not only in the form of video or animation but also as complex, detailed and interactive maps. Hivemapper (HONEY) is a Solana-based DApp that aims to build, maintain and share the world map with a high degree of interactivity, granularity and accuracy.
Users worldwide can contribute to building maps on Hivemapper and earn crypto rewards in the form of HONEY tokens in the process. One way of contributing map data to the platform is to use a dash or phone cam to capture the landscape as you drive or walk across it. You can also earn HONEY tokens by helping to improve the maps in a gamified environment that’s powered by AI technology.
DePIN – Frequently Asked Questions
How Does DePIN Work?
DePIN platforms typically allocate some hardware or software resources — computing power, data, network connectivity or bandwidth — over a distributed network by aggregating those resources from many providers. Each provider might contribute a minimal amount of the resource, but thanks to the decentralized mode of operation, the cumulative contribution leads to boundless capacities held by the network.
Users of the resource can tap into these capacities, utilizing them as much or as little as required on a demand-based, per-use basis.
What Advantages Do DePINs Offer?
Hardware and software infrastructure provision has been dominated by traditional cloud services players like Amazon, Microsoft and Oracle. Using their position and bargaining power, these companies have maintained high prices and dictated the terms of the market. With the arrival and growth of DePIN services, this dominance is being challenged. These centralized providers can expect the challenge to become even more intense as the DePIN concept gains more popularity and appreciation.
The growth of DePIN hasn’t come out of thin air; this innovative technology holds numerous benefits as compared to traditional computing infrastructure provision. The key benefits of DePIN platforms include:
Reducing the cost of access to resources
Scaling horizontally
Rewarding resource contributors
Enhanced security, thanks to the utilization of cryptographically protected, decentralized blockchain networks
What Role Do DePIN Tokens Play?
Native tokens of DePIN platforms are a critical element that props up the trade in physical resources over decentralized networks. They’re used as a reward mechanism to encourage businesses and individuals to share their computing resources. At the same time, resource consumers use these tokens to pay for access to the required services.
On some platforms, they’re also used as governance tokens, as holders of these crypto assets may participate in on-chain decision-making. This participation often includes voting on the adjustments to crucial parameters, such as the rules of resource contribution and consumption, rates charged, user membership tiers and more.
Closing Thoughts
In summary, the DePIN sector is vast and continuously evolving, showcasing a dynamic landscape ripe with opportunities for real-world applications. As technology advances and blockchain adoption becomes more widespread, the potential for DePIN to revolutionize various industries is becoming increasingly apparent. Innovation in the space continues to unfold, and DePIN is poised to play a pivotal role in shaping the future of digital identity and data privacy.
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